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The Christmas selling season has begun. Not officially, since the formal start of the season begins the day following Thanksgiving. But holiday merchandise can already be seen in the stores — and marketing and promotional programs have even now been launched.
The Christmas selling season has begun. Not officially, since the formal start of the season begins the day following Thanksgiving. But holiday merchandise can already be seen in the stores — and marketing and promotional programs have even now been launched.
Initially at least, the most aggressive holiday effort appears to be the one undertaken by Walmart. As November dawned, the nation’s largest retailer ushered in the holiday season by "rolling back" prices on some 20,000 items while promoting its program of ordering online and picking up the ordered items at the store. Additionally, the retailer began offering its customers a program, accessible online, that afforded them the opportunity to pay less for merchandise to which they had already committed.
Beyond these initial programs, Walmart has already expressed its intentions to embrace suppliers more routinely and dramatically than the retailer has sometimes done in the past. Its program to encourage suppliers to provide more items that have been produced in the United States has already begun paying dividends in the form of merchandise either previously sourced in Asia or bypassed completely. Additionally, the company has begun to do a better job outlining more specifically what it expects from suppliers and what it is prepared to offer in return.
Make no mistake: What Walmart is after is business, business that had in the past gone to other retailers or business that the retailer had chosen to pass up. But the company’s new leader, Doug McMillon, has made it clear that that policy is no longer acceptable — and that some of the criticism suppliers have leveled at Walmart in the past is justified and, as such, no longer acceptable.
Clearly, Walmart has been stung by supplier accusations that it has not always been an easy retailer with which to deal. However, the company maintains that much of the difficulty suppliers encountered in the past was based on the problems suppliers encountered in understanding Walmart and what the retailer expected from the suppliers with which it did, or hoped to do, business.
To remedy this perception, Walmart, going forward, insists that its merchants will become more accessible and easier to deal with, and more open to new ideas, new items and new programs.
What will not change, however, is Walmart’s insistence on getting to examine new products quickly — more quickly, by implication — than other retailers, and being offered pricing packages on all merchandise that are more equitable than those presented to other retailers.
While much of this is standard procedure, and Walmart hardly expects to be favored in merchandise negotiations, what the retailer does expect is this: A fair deal from its supplier partners. Clearly, this has not always been forthcoming in the past. Too many suppliers, it appears, have been discouraged either by Walmart’s size, leverage, reputation or perceived difficulty in negotiating with the Bentonville, Ark., company. Certainly, it is true that Walmart has been the subject of more supplier-generated stories, incidents, mixed messages and plain misunderstandings than any other retailer has had to contend with and combat in this century. Stories abound of the retailer’s excessive demands, unfair proposals, uneven negotiations and unlivable negotiating conditions, invariably accompanied by verification from other disgruntled or dissatisfied suppliers.
At this, the dawn of the Christmas selling season, Walmart is determined to change all that. Stories are even now emerging from suppliers about easier access, more equitable negotiating situations, more pleasant business meetings, more thorough follow up and more comprehensive business reviews. Clearly, the retailer has come to recognize that sales increases going forward will not be as easily achieved as they have been in the past. Gains of 6%, 7% and 8% have already been replaced by increases of 3%, 4% and 5%. Nor will these increases come as routinely as they once did. Competition is keener than it once was — and competitors no longer fear Walmart as they once did.
The feeling here is that Walmart is serious about composing and practicing a new, more enlightened and more welcomed stance in dealing with its supplier partners. And if Walmart seriously intends to simplify its business dealings with suppliers, the result will be that all retailers will soon seek to find their own methods of simplifying their supplier relationships. If the history of retailing has proved one thing, it is this: When retailers and suppliers are on the same page, business is the primary beneficiary.